oil and gas exploration firm BG has sidestepped a potential revolt over a £15m “golden hello” for its new boss by announcing a revised package in the face of shareholder opposition.
The FTSE 100 group has cancelled an initial shares award for Helge Lund worth up to £12m and replaced it with an award worth up to £10.6m under a separate long-term bonus plan with more stringent performance criteria.
BG said it would mean the expected value on award of this part of the “golden hello” is cut from around £10m to £4.7m.
It also means there will be no need for a planned shareholder vote set for December 15, as the changes mean the award falls within the company remuneration policy approved earlier this year.
But the total “golden hello” for Mr Lund – including a £480,000 relocation package and shares worth up to £3m to compensate for unvested bonuses – will still amount to a maximum of around £14m.
He will also still receive an annual package of up to £14m a year including an annual salary of £1.5m plus payment in lieu of pensions, annual bonus, and a yearly long-term share award.
The changes come after a chorus of discontent from investment advisory bodies over the initial package, with the Institute of Directors (IoD) saying it “brings the whole of British business into disrepute”.
Mr Lund is due to take over as BG chief executive in March after 10 years running Norwegian energy giant Statoil. BG said: “Mr Lund is an exceptional candidate, with the necessary skills and experience to lead BG Group and it is clear from the extensive consultation with shareholders over the past few weeks that this view is widely shared.
“However, a significant num-ber of shareholders questioned the structure of the package, in particular whether it was appropriate to go outside the remuneration policy approved by shareholders earlier this year.”